The pond contains toxic ash generated from the power plant. Due to heavy rain in the region in the past two days, one of its walls reportedly breached and the toxic water spilled on to nearby areas.

After the breach, toxic ash-ladden water spilled on to an area spread in a radius of nearly 5 km.

In response to complaints of farmers from Singrauli district of Madhya Pradesh who have alleged toxic water from an artificial pond at a power plant run by the Essar Group is entering their agricultural fields, the Essar Group has said the breach took place due to a "brazen act of sabotage" by the villagers.

The pond contains toxic ash generated from the power plant. Due to heavy rain in the region in the past two days, one of its walls reportedly breached and the toxic water spread in a radius of approximately 5 km.

The power plant is located in Badhoura, about 35 km from the district headquarters.

On Thursday, speaking to India Today TV, district officials said the toxic water from the reservoir has spilled into a radius of over 5 kilometres, causing panic among locals.

District sub-divisional magistrate (SDM) Vikas Singh visited the affected area on Thursday morning and said five children were rescued. He said no loss of life has been reported.

"The locals are demanding compensation from the Essar Group and we have assured them that the company would be made to do so," Vikas Singh had told India Today TV on Thursday.

On the other hand, the Essar group has issued a statement where it said it is "deeply shocked and anguished" that a wall of the ash dyke at its Mahan Power Plant in Madhya Pradesh was "breached by an act of sabotage", and the ash entered the adjoining land in Kasualal village.

The area around the Esssar power plant after toxic water breached its reservoir.

It said, "[We] would like to categorically clarify that the breach of the ash dyke wall is a clear case of sabotage and that the land where the ash entered is non-agricultural land owned by Essar Power. Our security personnel deployed at the location have given a statement to the local police saying that they spotted four-five unidentified persons fleeing from the site of the incident last night. We have filed an application for FIR alleging sabotage, and also apprised all local authorities about the incident."

The statement alleged that even in the past, the villagers have been up to "similar mischief". It said the land where the ash entered is no longer an agricultural land and that it had paid due compensation to all displaced families."Families continue to live on the land at their own risk as encroachers despite repeated requests from Essar Power," the statement said.

Resident say the toxic water has severely damaged their standing crop.

THE OTHER SIDE

Meanwhile, locals say the toxic water has spilled on to their fields and severely damaged their standing crop. "The ash water from the power plant has entered into the fields and there is no question of survival of the crops now. We urge the state government to look into the matter as the district administration it appears is inclined to side with the power plant," Sohan Lal, a farmer had told India Today TV on Thursday.

Districts officials have moved people from the affected areas to nearby community halls as contaminated water has even entered houses.

"Some loss of cattle has been reported by the villagers and the same are being verified," a district official said.